QUESTION 3 PARTNERSHIP NET INCOME AND TAX LIABILITY Scenario Partnership, pizza bar Jay Jays is a large pizza bar restaurant chain of 3 shops in Melbourne (located city, north and south) owned by Jagjeet and Jiera. The books of account for 2020 income year reveal the following: Sales 1,500,000 Closing stock 20,000 Opening Stock 10,000 Purchases 300,000 Various business expenses 589,000 - Advertising 6,000 - Electricity 12,000 - Insurance 9,000 - Interest on loan - premises 160,000 - Rent 100,000 - Staff wages 300,000 - Telephone 2,000 Other expenses 121,000 - Bad Debt 1,000 - Depreciation 100,000 - Repairs 15,000 - Tax agent expenses 5,000 Salaries 83,200 - Salary for Jagjeet 52,000 - Salary for Jiera 31,200 Jagjeet and Jieras partnership agreement provides that profits are to be distributed equally and that wages should be paid weekly by the partnership to the partners as mutually agreed. Jagjeet is paid $1,000 a week and JIera is paid $600 a week. REQUIRED Part 1 8 marks Advise what is the net income of the partnership hint use this table to prepare your answer Issue Law applicable only (NB reasons or explanation not required! ) Impact on Net income Part 2 3 marks Are the partners salaries deductible - advise your reasons and provide case law and relevant rulings.? Part 3 4 marks Advise the tax liability of Jagjeet only, taking into account the distribution of the partnership net income